Canadian 'Supervising' Installation in the US - Taxes Owed?

Hello, I am new to this board and am happy to have been able to find such a useful resource. I have looked through the forums and not come across something similar to my question, if I missed a similar post I apologize.
The way that things work at my company, when we go to the US for service (typically installation work making it eligible for the OETC) we cross the border using a letter with the company letterhead and the PO for the job attached stating that we are entering the US to supervise installation of the job and that the work is not being completed by us. Sometimes, obviously we do work, however, we would not be allowed into the States with some kind of working Visa if they looked at what we are doing as taking a job away from an American citizen. My question then is what taxes would I or any employee at our company be responsible for to the States? Everything I have found so far always talks about having some kind of Visa. We don't hold SSN's, or have Tax ID numbers in the States so really there is no record of us at all with the IRS and like I said we cross on the premise that we are not working. So what does that do for our tax requirements after getting the OETC in Canada? Anyone that can offer some suggestions, it would be greatly appreciated by all of us in this situation here.

Thanks in advance.

Ian

Actually in the standard B-1 NAFTA business visitor category you can do installations, the regs are quite specific on that.

Under the tax treaty you only have to go on US payroll and pay US taxes if you are in the US for more than 183 days or you're paid more than CDN$10,000 for the work you do while you're there, if you are directly employed by a Canadian employer.

So basically from the sounds of it unless you get paid more than $10,000 a year to do your job in the US, all you need really is a Canadian passport so you can enter the country.

If you are over that limit the company you're working for needs to register with the IRS and get an EIN, do US payroll and issue you a W-2 for the pay you receive for the work you did in the US, then you use it in the same way as a T4 to do your tax return every year and use forms T2036 and T2209 to claim a foreign tax credit for it (so you don't get taxed twice).

Steve, thanks for your response. As far as what goes for many that work here we end up working more than the 183 days in the States and are making more than the $10k as our salary from our company. If in the States for work I would expect that this salary would count as getting paid for doing our jobs in the States and thus we would be on the hook for paying taxes in the States, if I understand what you're saying correctly. However, our company is not giving us anything other than a 626 form in order to apply for the OETC so how would we know what taxes are required to be paid to the States?

By law they have to put you on US payroll and do US withholding. As explained in IRS publication 515. So you would get a W-2 from your employer.

In the absence of them complying with the law, you're supposed to, which means you would have to work out how much you got paid while in the US, put it down on a 1040NR, send a cheque in to the IRS, then claim a foreign tax credit in Canada for it.

However really this is a responsibility for your employer. The 2008 tax treaty revisions make it pretty clear that in the absence of the exemption applying, tax must be paid proportionally in the country where there wok is performed. That was the major reason for the 2008 revisions.

I suggest you get hold of someone in your company and tell them to get in touch with a cross-border accountant.

Thanks for your help Steve, I really appreciate it.